Taxpayers to pay £5.9 billion in tax on festive spending this Christmas
Embargoed: 00:01 Wednesday 18 December
Research by the TaxPayers' Alliance has revealed the extent of the taxman's squeeze on festive spending this Christmas.
The typical UK household will spend £1,344 on Christmas, of which £212, or nearly 16 per cent, will be tax. That would be enough to buy 18 of Lidl's delicious luxury Christmas puddings.
Whether it's a necklace for your other half, a games console for the kids, a bottle of bubbly for the family or a chocolate yule log for pudding, practically all Christmas purchases will be taxed via levies like VAT, alcohol duty, fuel duty or the sugar tax.
The total tax bill will run to £5.9 billion, more than double the annual cost of job seeker's allowance payments.
Click here to read the research paper
Key findings
- VAT is levied on nearly all Christmas purchases - 90 per cent of spending on parties, pressies and Christmas meals will be subject to it. As a result, households will pay £5.1 billion in VAT this Christmas, equivalent to £182.80 per household.
- Alcohol duty is felt especially keenly in December when drinkers put away 30 per cent more booze than in other months. This extra consumption means that drinkers pay an extra £315 million in alcohol duty, £11.32 per household.
- The average household drives 302 miles to parties, relatives' homes and last minute shopping trips during the Christmas season. This means that the total fuel duty bill will amount to £247 million, or £17.74 a household.
- The sugar tax will cost the public £300 million in 2019-20, meaning that the Christmas thirstiness will lead to an additional £7.5 million being paid on the soft drinks industry levy.
Click here to read the research paper
John O'Connell, chief executive at the TaxPayers' Alliance, said:
"Despite families already forking out a fortune for the festive season, the taxman has clearly decided it 'tis not the season to be jolly.
"Scrooge may have seen the error of his ways, but the greedy grinch of Whitehall has not discovered generosity this Christmas, with inefficiency making public services much more expensive than needs be for those who foot the bill.
"Taxpayers are not Christmas puddings to be raided for pound coins - the new government should look to wipe out wasteful spending and reduce the burden for typical taxpayers."
TPA spokesmen are available for live and pre-recorded broadcast interviews via 07795 084 113 (no texts)
Media contact:
Sam Packer
Media Campaign Manager, TaxPayers' Alliance
[email protected]
24-hour media hotline: 07795 084 113 (no texts)
- Founded in 2004 by Matthew Elliott and Andrew Allum, and now with 80,000 supporters, the TaxPayers’ Alliance (TPA) fights to reform taxes, reduce spending and protect taxpayers. Find out more about the TaxPayers' Alliance at www.taxpayersalliance.com.
- TaxPayers' Alliance's advisory council.
- The Office for Budget Responsibility estimates that the gross "no-UC" spend on jobseekers' allowance for 2018-19 was roughly £2.5 billion.